Black Reparations and Wealth Equality: Lessons from Child Development Accounts As a Policy Structure for Asset Building

The idea of Black reparations--compensation to Black individuals or communities for historical harms and injustices--is not new, but it has gained renewed attention and momentum due to unfortunate and well-publicized racist events, growing research evidence, and ongoing discussions about racial inequality and social justice. A majority of Black adults (77 percent) think that descendants of people enslaved in the United States should be repaid in some way, and 30 percent of all US adults now agree with this position. The percentages reflect a notable recent change in public opinion on reparations. Policy sparks are also appearing. At the local level, a number of cities across the country have taken steps to address Black reparations. At the federal level, provisions for a commission to study reparations have been introduced in several Congresses, and the proposal has gained support from a growing number of lawmakers. Black reparations provide a potential solution to the extreme racial wealth inequality in the United States, which has increased over the last four decades, with Whites holding eight or more times the net worth of Blacks.

In this roundtable, viewpoints on Black reparations will be summarized, including recent research and policy development (e.g., local programs, eligibility, funding, and federal policy proposals). More specifically, we offer a structural solution and a body of applied research evidence, demonstrated in the form of Child Development Accounts (CDAs), in how to deliver Black reparations so that it may have lasting and sustainable asset-building impacts.

Successful Black reparations require a policy structure for delivering payments with effective identification, disbursement, asset protection, and asset growth over time. In this regard, Child Development Accounts (CDAs) --a carefully designed and tested asset-building policy for children -- provides a structural model that can inform efficient and effective delivery of reparations.

First, the CDA policy is rooted in the original proposal to address the stripping of Black American assets and other historical harms. The research data from CDAs have shown strong statistical associations between family historical harms and wealth ownership. The CDA proposal has recommended substantial public deposits (over $30,000 per child in today's dollars) for the purpose of wealth equity. Furthermore, CDA policies in the United States follow ten core features, designed to ensure that the accounts are progressive, potentially lifelong, on a centralized system, with automatic enrollment, and built on an efficient, scalable, and stable policy model capable of promoting asset accumulation for development purposes. We argue that, as a policy based on these core features, CDAs could serve as a policy platform to deliver reparations payments.